What was the outcome of Tenancy Tribunal case 4838662?

The tribunal order states: The tenancy of Janice Sheldon and Mark Reginald Taylor at 220 Hautere Cross

How much money was awarded in case 4838662?

Property Damage: $250.00 awarded to landlord; Property Damage: $170.00 awarded to tenant; Property Damage: $5,000.00 awarded to tenant; Property Damage: $600.00 awarded to landlord; Filing Fee: $20.44 awarded to landlord; Removal Of The Unconsented Fire: $500.00 awarded to landlord; Rent 30/8/24 - 19/9/24: $900.00 awarded to landlord; Rent Owed 10/11/23 - 29/8/24: $9,000.00 awarded to landlord

What type of tenancy dispute was case 4838662?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4838662?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10761152-Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 4838662?

The tribunal order states: The tenancy of Janice Sheldon and Mark Reginald Taylor at 220 Hautere Cross

How much money was awarded in case 4838662?

Property Damage: $250.00 awarded to landlord; Property Damage: $170.00 awarded to tenant; Property Damage: $5,000.00 awarded to tenant; Property Damage: $600.00 awarded to landlord; Filing Fee: $20.44 awarded to landlord; Removal Of The Unconsented Fire: $500.00 awarded to landlord; Rent 30/8/24 - 19/9/24: $900.00 awarded to landlord; Rent Owed 10/11/23 - 29/8/24: $9,000.00 awarded to landlord

What type of tenancy dispute was case 4838662?

The primary dispute was Exemplary damages.

Where can I read the official tribunal order for case 4838662?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/10761152-Tribunal_Order.pdf.

220 Hautere Cross Road, Hautere, RD 2, Otaki 5582 Tenancy Tribunal Case 4838662 — Exemplary damages

Claims and awards in Tenancy Tribunal application 4838662 — net $6,100.44 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Tenant	Reason
Exemplary damages: unlawful use	$600.00		unlawful use
Exemplary damages: access for the inspection	$250.00		access for the inspection
Removal of the unconsented fire	$500.00		Removal of the unconsented fire
Rent owed 10/11/23 - 29/8/24	$9,000.00		Rent owed 10/11/23 - 29/8/24
Rent 30/8/24 - 19/9/24	$900.00		Rent 30/8/24 - 19/9/24
Filing fee reimbursement	$20.44		Filing fee reimbursement
Exemplary damages: breach duty to maintain, insulate		$5,000.00	breach duty to maintain, insulate
Exemplary damages: breach duty relating to documents		$170.00	breach duty relating to documents
Total award	$11,270.44	$5,170.00
Net award	$6,100.44
Total payable by Tenant to Landlord	$6,100.44

Claims and awards in Tenancy Tribunal application 4838662 — net $6,100.44 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Tenant	Reason
Exemplary damages: unlawful use	$600.00		unlawful use
Exemplary damages: access for the inspection	$250.00		access for the inspection
Removal of the unconsented fire	$500.00		Removal of the unconsented fire
Rent owed 10/11/23 - 29/8/24	$9,000.00		Rent owed 10/11/23 - 29/8/24
Rent 30/8/24 - 19/9/24	$900.00		Rent 30/8/24 - 19/9/24
Filing fee reimbursement	$20.44		Filing fee reimbursement
Exemplary damages: breach duty to maintain, insulate		$5,000.00	breach duty to maintain, insulate
Exemplary damages: breach duty relating to documents		$170.00	breach duty relating to documents
Total award	$11,270.44	$5,170.00
Net award	$6,100.44
Total payable by Tenant to Landlord	$6,100.44

Order

The tenancy of Janice Sheldon and Mark Reginald Taylor at 220 Hautere Cross Road, Hautere, RD 2, Otaki 5582 is terminated, and possession is granted to Sue Phellan, at 11.59 pm on Thursday 19 September 2024.
Janice Sheldon and Mark Reginald Taylor must pay Sue Phellan $6,100.44 immediately, calculated as shown in table below:
All other claims are dismissed.

Reasons

Both parties attended the hearing. Mr Taylor represented the tenants.
This tenancy started in January 2018. The tenancy premises is a three bedroom weatherboard house built in the 1930s, situated on a farm owned by the landlord and her husband. The rent throughout the tenancy has been $300 a week. Over the last six years landlord has called in to say hi to the tenants when visiting the farm, but there were no inspections until May 2024. There is no written tenancy agreement and neither party has completed any tenancy documentation until this year. The landlord gave the tenant a 90 day notice in March 2024 because the house is going to be sold.
The tenants filed an application for exemplary damages and compensation because the house was not insulated or maintained, and because they have were concerned the 90 day notice was retaliatory. The landlord filed a cross application for rent arrears, compensation and exemplary damages. The questions I have to decide are: • Was the notice to terminate a valid notice? • Was the notice a retaliatory notice? • Did the landlord breach her duties under the RTA? • Should the tenants get compensation? • Did the tenants use the tenancy premises for an unlawful purpose? • Did the tenants hinder access at the May inspection? • Should the landlord get compensation? • How much rent do the tenants owe?

Was the notice to terminate a valid notice?

On 5 March 2024 the landlord gave the tenants a notice ending the tenancy in June. Since 11 February 2021 landlords have can only a 90 day termination notice if there is a valid reason under s 51 Residential Tenancies Act 1986 (RTA).
Section 51(2)(a) provides that a landlord can give a 90 notice to end a tenancy when the premises are to be put on the market by the owner within 90 days after the termination date for the purposes of sale or other disposition. The relevant time for determining the landlord’s intention is when the notice was given. For the notice to be valid the landlord should genuinely intend to carry out the stated objective. It is not enough that it is a mere possibility or one of a range of options available.
The landlord said she has been considering selling the house for years. She had an appraisal done by the local real estate agents at the end of May last year. She said she has had discussions with the agent this year who said to be in touch once the landlord had possession. The landlord also provided me with a letter from a neighbour. The letter corroborates the intention to sell when the notice was given. The tenants said a sale has been mentioned many times over the years and that an appraisal is not an agreement to sell.
It is the landlord who has to prove the notice was valid. I am more persuaded by the landlord’s evidence and submission. I find there was a valid notice.

Was the notice a retaliatory notice?

The tenants claim the notice was retaliatory. For a notice to be declared retaliatory, the tenant must prove that in terminating the tenancy, the landlord was motivated wholly or partly by the tenant exercising a right under the tenancy agreement or any Act, or by any complaint against the landlord. The Tribunal can declare such a notice to be of no effect. See section 54(1) RTA.
Giving a termination notice which is declared to be retaliatory is an unlawful act for which exemplary damages may be awarded, up to a maximum of $6,500.00. See section 54(2), (3) and Schedule 1A RTA.
The landlord was at the farm on 28 February 2024. She said she had the 90 day notice for the tenants. She went to the house to discuss the sale but this interaction was not successful. The landlord returned to Auckland and received a 14 day notice from the tenants for repairs and healthy homes requirements. The landlord then arranged for a neighbour to serve the termination notice. The date on the notice was changed to 5 March.
Whether or not the landlord was motivated wholly or partly by the tenant exercising a right under the tenancy agreement or any enactment, or by any complaint against the landlord is the tenants’ claim to prove. Their submission that the short period of time between the tenants serving the 14 day notice and the landlord serving the notice leads to a strong inference that the landlord was at least partly motivated by the tenant exercising their rights is persuasive. In this situation, the evidential onus shifts to the landlord to show that there was a legitimate reason for the notice.
Again, I find the landlord’s submission about the sale, the appraisal last year, the amended date on the notice and the letter from the neighbour to be more persuasive than the tenants’ evidence. I find the notice was not retaliatory. This means the tenancy will end. The last day of the tenancy will be Thursday 19 September 2024.

Did the landlord breach her duties under the RTA?

Since this tenancy started a number of requirements have changed. Landlords are expected to keep up with any changes to the RTA.
From 1 July 2019, all residential premises had to be insulated to a minimum standard. This included the ceiling space and under the house, depending on access. See s 45(1)(bb) RTA and Part 2 Residential Tenancies (Smoke Alarms and Insulation) Regulation 2016.
The landlord said the house has insulation in the ceiling but this hasn’t been checked for many years. There is no underfloor insulation. I find this was a breach by the landlord.
Section 45(1)(ba) of the RTA requires that landlords comply with all obligations in relation to smoke alarms made under section 138A. The relevant regulations are the Residential Tenancies (Smoke Alarms and Insulation) Regulations 2016, which require landlords to have qualifying smoke alarms installed and operational.
To qualify all new smoke alarms must be photoelectric, have a battery life of at least eight years, be installed according to the manufacturer’s instructions, meet international standards, be in full working order, and have their expiry date displayed. Existing smoke alarms did not need to be replaced so long as they were in full working order and had not passed their expiry date.
The tenants said the smoke alarms never beeped in the six years they have lived in the house so it seems unlikely they were working. The landlord remembers there were smoke alarms in the house but these were not checked when the laws changed. I find this was a breach by the landlord.
Under section 45 RTA a landlord must provide and maintain the premises in a reasonable state of repair. The landlord has inspected once in six years, and that was a couple of months ago.
The tenants said they had carried out a number of other repairs over the years but the landlord was not necessarily told about these and they would not have been obvious even if the landlord had inspected. For example, the tenants said they replaced hot water cylinders and the pump for the water supply. I find the landlord cannot be responsible for repairs she was not aware of.
There were other issues which the landlord should have known about. The tenants said there were broken windows that the landlord never fixed. The gutters have cracked in places and water spills out when it rains. The roof over the porch leaked and was replaced by the tenants. There was a leak under the sink. There is black mould in the bedrooms. The landlord was not formally notified about these until the 14 day notice given in February this year. The tenants said they never bothered telling the landlord because she always said there was no money for repairs and that spending money on the house was not in her plans.
The landlord replied that she would have made repairs if the tenants had told her about the issues. She did fix the toilet in a timely manner after she was notified of the problem. However, it seems most likely to me the landlord would have noticed the big issues if she had carried out inspections. Gutters are a landlord responsibility. The broken windows and the black mould would have been obvious. I find there was a breach by the landlord.
Breaching the obligations to insulate, provide smoke alarms. and repair and maintain is an unlawful act for which exemplary damages may be awarded up to a maximum of $7,200.00. See section 45(1A) and Schedule 1A RTA.
Where a party has committed an unlawful act intentionally, the Tribunal may award exemplary damages where it is satisfied it would be just to do so, having regard to the party’s intent, the effect of the unlawful act, the interests of the other party, and the public interest. See section 109(3) RTA.
The landlord said she could not afford to install insulation. She said she was not aware of the law changes for insulation and smoke alarms. She said she never inspected because she would have a chat once or twice a year when she visited the farm and everything seemed ok. I find the landlord’s lack of care about this tenancy was intentional. The effect on the tenants was they carried out repairs that were not their responsibility. The house was cold, damp and mouldy without insulation, proper guttering, and draughty, boarded up windows. It is in tenants interests that houses are warm and safe and there is public interest that landlords pay exemplary damages when there are breaches of the RTA.
I allow $5000 in exemplary damages. This is at the upper end of the scale because of the number of breaches over a long period of time.
I find the landlord also breached the duty to provide an insulation statement in the tenancy agreement, which was a requirement when this tenancy started in January 2018. Exemplary damages in the maximum amount of $500 could be awarded for this breach at the time. See 13A(1A) RTA and schedule 1A RTA.
The landlord is also required to keep proper business records showing details of all rent payments paid by the tenant. The landlord produced rent summaries for the first time for the hearing. Breaching this obligation is an unlawful act for which the Tribunal may award exemplary damages up to a maximum of $350.00. See section 30(1) RTA and Schedule 1A RTA.
I find the landlord committed unlawful acts. The same considerations apply. I find that not researching the legal requirements when running a business is an intentional act. The effect for the tenants was minimal because they were living in the house as flatmates before the tenancy started, and because rent summaries were provided for the hearing. Nonetheless, it is tenants’ interests to have rules about disclosure and proper business practice. There is public interest in landlords being penalised when they ignore them.
I allow exemplary damages of $170. This is at the lower end of the scale because I am not aware of any similar orders against the landlord.

Should the tenants get compensation?

The tenants have claimed compensation in the amount of $60,000 for money they have spent on repairs and replacement items over the years. In order for me to allow compensation the tenants have to prove there was a loss. We discussed the work the tenants have carried out over the years. The tenants said they purchased all the replacement items using cash which means there is no supporting documentation such as receipts. The tenants have not proved this claim and it is dismissed.

Did the tenants use the tenancy premises for an unlawful purpose?

It is agreed evidence the tenants grew cannabis at the tenancy premises. The tenants said this was a couple of plants for medicinal use. This evidence is credible. The landlord submitted the tenants were using the premises to grow a much larger crop, and she reported this to the police. The police have taken no steps, so this is speculation.
Nonetheless, a tenant must not use the premises or permit the premises to be used for an unlawful purpose. Breaching this obligation is an unlawful act for which exemplary damages may be awarded up to a maximum of $1,800.00. See section 40(2)(b), 40(3A)(c) and Schedule 1A RTA.
Growing cannabis, also known as cultivating prohibited plants, is an offence under the Misuse of Drugs Act 1975. I find the tenants committed an unlawful act. I find the tenants’ actions were intentional. The landlord was concerned that the growing was large scale, which was stressful at the time. It is in landlords’ interests that nothing against the law happens at their rental properties and there is public interest in tenants paying exemplary damages when they breach the RTA.
I allow exemplary damages I the amount of $600. This is at the lower end of the scale because I am not aware of any similar orders against the tenants.

Did the tenants hinder access at the May inspection?

The landlord claims the tenants have not allowed her entry to the premises when she was entitled to enter. Specifically, that the tenants would not allow access to one of the bedrooms in the house when the landlord was there for the inspection. The tenants said this bedroom is used to store belongings for a family member. They denied entry to the room and had nothing further to say at the hearing.
A landlord may enter the premises during the tenancy with the tenant's consent, in an emergency, or after giving the required notice for inspections and repairs and maintenance. Breaching this obligation without reasonable excuse is an unlawful act for which exemplary damages may be awarded up to a maximum of $1,500. See section 48(1), (2), (4)(b) and Schedule 1A RTA.
The landlord was entitled to look in the room because she gave proper notice for an inspection. I find the tenants committed an unlawful act and that they acted intentionally. The effect for the landlord is an ongoing suspicion that the tenants are hiding something from her, which is stressful. It is in landlords’ interests that they can inspect properly and there is public interest in an order for exemplary damages when tenants block access.
I allow exemplary damages in the amount of $250. This is at the lower end of the scale because it is most likely a first breach and because it was only one room in the house.

Should the landlord get compensation?

The landlord has claimed compensation. The tenants knocked through a wall and installed a door. The landlord did not agree to the alteration. The tenants agreed at the hearing to reinstate the wall before the end of the tenancy. The tenants have also agreed to empty and fill in a fire pit. There are two storage containers on adjacent farmland which will go by the end of the tenancy. The tenants have agreed to empty their belongings and building materials out of the stables and any other farm building which are not part of the tenancy premises. No compensation is allowed for these because the tenants have agreed to remedy the breach.
The tenants installed a fireplace which does not have Council consent. The landlord has asked for compensation for the cost of completing the building work required and for the cost of the consent. The landlord has clearly suffered a loss. The landlord only had a verbal indication from a builder who had not been to the house as to the likely cost. I need better evidence before I can allow compensation. I have allowed an estimated $500 for the cost of removing the fireplace instead.
The claims relating to the adjoining farmland that were discussed at the hearing were dismissed for want of jurisdiction. It is possible the landlord has a claim in another jurisdiction for any farmer v person disputes.

How much rent do the tenants owe?

The landlord has applied for rent arrears. She provided rent summaries which show the tenants owe $44,848 at the time we had the hearing. Rent is only $300 a week. The tenants have been in arrears for a number of years. The Tenancy Tribunal will end tenancies when the rent is more than 21 days behind.
The landlord said she sometimes called or sent messages about the rent arrears, but she never followed up with a 14 day notice, and she filed her first Tribunal application this year. The landlord acknowledged that she could have ended the tenancy much sooner, but having people in the house paying rent sporadically was better than having an empty house vulnerable to squatters.
The tenants accepted the rent summaries are correct. They said they sometimes stopped paying rent as an unofficial way of getting compensation or reimbursement for the repairs and replacement items. Sometimes they just didn’t pay rent.
In the context of the casual management of the tenancy - with no written tenancy agreement, no inspections, and the impression the tenants were responsible for maintenance - it seems very unfair to order the tenants to pay almost $45,000 in rent arrears.
Section 78(1)(h) RTA allows the Tribunal may make any orders that the High Court or District Court may make under any enactment or rule of law relating to contracts. This includes equitable remedies such as estoppel. The underlying principle of equitable estoppel is to prevent the exercise of strict legal rights in circumstances where the exercise of them would be unconscionable. This principle is entirely consistent with the jurisdiction of the Tenancy Tribunal (Stella & Carey v Bay of Islands Realty Limited & Kirkman [2016] NZTT Kaikohe 4051975 & 4053657), in particular s 85(2) RTA, provides that: The Tribunal shall determine each dispute according to the general principles of law relating to the matter and the substantial merits and justice of the case, but shall not be bound to give effect to strict legal rights or obligations or to legal forms or technicalities.
It seems most likely to me the lack of 14 day notices or applications by the landlord has led the tenants to believe that they could continue to withhold rent for repairs or for any other reason, and there would be no legal consequences. I find it would be unfair to change that position now. The landlord is estopped from claiming rent arrears before November 2023, which happens to be the start of the last page of the rent records provided at the hearing.
I find the tenants owe $9,900 in rent. This takes the rent through to the end of the tenancy. Other orders
Because the landlord has substantially succeeded with the claim I have reimbursed the filing fee.
The landlord did not make an application for suppression. The tenants’ application for suppression is not allowed because the tenants are not the most successful party. Further, there is public interest in the names when the tenants owe money.

Tenancy Tribunal case 4838662 — Exemplary damages at 220 Hautere Cross Road, Hautere, RD 2, Otaki 5582

At a glance

Tenancy Tribunal case 4838662 — Exemplary damages at 220 Hautere Cross Road, Hautere, RD 2, Otaki 5582

At a glance

Award balance

Claims & awards

Dismissed claims

Order

Reasons

Was the notice to terminate a valid notice?

Was the notice a retaliatory notice?

Did the landlord breach her duties under the RTA?

Should the tenants get compensation?

Did the tenants use the tenancy premises for an unlawful purpose?

Did the tenants hinder access at the May inspection?

Should the landlord get compensation?

How much rent do the tenants owe?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Award balance

Claims & awards

Dismissed claims

Order

Reasons

Was the notice to terminate a valid notice?

Was the notice a retaliatory notice?

Did the landlord breach her duties under the RTA?

Should the tenants get compensation?

Did the tenants use the tenancy premises for an unlawful purpose?

Did the tenants hinder access at the May inspection?

Should the landlord get compensation?

How much rent do the tenants owe?

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions